Afghan Prez keeps minister considered corrupt by US

Washington: US officials pressured Afghan President Hamid Karzai to remove a former warlord from atop the Energy and Water Ministry a year ago because they considered him corrupt and ineffective, and threatened to end aid unless he went.

Karzai rebuffed the request, according to secret diplomatic records, and the minister — privately termed "the worst" by US officials — kept his perch at an agency that controls USD 2 billion in US and allied projects.

The State Department correspondence, written as Karzai was assembling a Cabinet shortly after his 2009 re-election, reveals just how little influence US officials have over the Afghan leader on pressing issues such as corruption.

Reining in graft is seen as vital to Afghanistan`s long-term stability. President Barack Obama last month cited an urgent need for political and economic progress even as military successes have blunted the insurgency in some regions.

But US aid to Afghanistan has continued despite the dispute over the former warlord, Ismail Khan, in December 2009.

US Ambassador Karl Eikenberry pressured Karzai to remove Khan, a once powerful mujahedeen commander, from the top of the Energy and Water Ministry, according to two State Department reports written at the time by US embassy officials in Kabul. They were disclosed last month by WikiLeaks.

A December 19, 2009, memorandum distributed internally under Eikenberry`s name described Khan as "the worst of Karzai`s choices" for Cabinet members. "This former warlord is known for his corruption and ineffectiveness at the Energy Ministry," the memo said.

Even with US threats to withhold aid, Karzai rejected requests to replace Khan. "Our repeated interventions directly with Karzai ... did not overcome Karzai`s deeply personal bonds with Khan," one of the reports said.

Asked earlier in 2010 about the corruption allegations, Khan, during a brief interview with a news agency, did not respond directly to a question asking whether he was profiting personally from the ministry. He denied any widespread problems of corruption or mismanagement.

"No money is missing from the ministry," he said. "All the income goes directly to the bank."

Khan said he was unaware of any complaints against him or the ministry. "If there have been complaints, nobody has come to me to tell me," he said.

The US continued pouring hundreds of millions of dollars into new energy and water projects that the ministry used to help generate tens of millions in customer fees. Many of those fees are lost each year partly due to corruption, according to US-funded reviews of the ministry`s operations.

The US diplomatic cables do not outline specific graft accusations against Khan, but detail several days of back and forth and consternation over Karzai`s decision to keep him. US officials have declined to comment on issues described in the WikiLeaks-released cables and criticised the group for making them public.

Karzai told US officials in a December 14, 2009, meeting that Khan had remained his choice for energy minister. Karzai said Secretary of State Hillary Rodham Clinton had agreed to the choice after Karzai had said he would appoint "competent deputy ministers" under Khan.

Eikenberry disputed that. He said keeping Khan in the post could jeopardise future aid because US policy prohibits investing "in ministries not competently led" and Congress was concerned about US spending in Afghanistan.

"If incompetent and corrupt ministers were appointed, it would provide a good reason for them to limit funding," the document quoted Eikenberry as saying in the meeting.

Karzai said he would reconsider. He eventually stuck with Khan.

Concerns about Khan and his ministry surfaced soon after he took over the agency in 2004. Consultants hired to identify problems in the ministry estimated that corruption contributed to the loss of USD 100 million or more each year from the country`s electricity system that should go back to the Afghan government, according to reports produced for the US Agency for International Development.